When life insurance claim denials border on the cruel
Our firm has been helping people contest the wrongful denial of life insurance claims for a long time. Consequently, we’ve seen a lot of tactics employed by life insurance companies that are downright surprising. We understand that life insurance is a cut-throat business and that life insurers will stop at nothing to increase profits by refusing to pay out claims.
Despite that experience, every once in a while we come across a case that truly shocks the senses. This article shares one such case. We’re not presenting it for the shock value, however. To the contrary, we’re using it as a simple illustration of how far life insurance companies will go to avoid paying out legitimate claims.
A father-daughter bond
In order to understand this particular case, you need to understand the strong bond that existed between a man named Roy and his daughter, Dana. Dana had been just three years old when her mother was killed in a boating accident. Prior to that time, Roy had not been the most involved father. In truth, Roy had no idea how to raise a little girl.
It didn’t take long after Dana’s mother died, however, for Roy to discover that he was perfectly capable of raising Dana. As time passed, the two didn’t care what they were doing, they just liked being together.
Roy must have done something right because Dana grew up to be highly successful. She was valedictorian of her high school class, got a full academic scholarship to an Ivy League college, and graduated first in her law school class. At her first job out of law school, Dana was making more money per year than Roy had ever made in a decade. He couldn’t have been more proud.
A big-time insurance policy for a big-time job
Dana’s law firm was exceptionally generous with benefits. Among other things, the firm provided (and paid premiums on) a life insurance policy worth $2 million. Dana was not yet married, didn’t have kids, and didn’t even have a serious boyfriend when she started at the firm. Consequently, she named her father as her sole beneficiary. When she did so, she joked with Roy that if she died, she was going to make him rich.
The practice of law was difficult for Dana. She averaged 80 hours per week, rarely saw the light of day, and found herself surrounded by other attorneys that she didn’t have all that much respect for. In fact, she very quickly found herself slipping into a depression.
Nonetheless, Dana made the best of it for a few years. She bought her first house in a suburb not far from her firm. As soon as she was able, she bought a condo just a few blocks away for her father. Roy was getting older and she wanted him close by so she could spend as much time with him as possible during those rare moments that she wasn’t working or sleeping.
A frantic evening
One evening, Dana had made plans to meet Roy for dinner. She was about to finish up a big project and had a rare occasion to just enjoy a leisurely dinner with her dad. The two talked about it for days. Dana’s project had to be turned in by 5pm, no matter what. Thus, the father-daughter team decided to meet at their favorite restaurant at 5:45.
Roy was on time. Dana, however, was nowhere to be seen. She always called if she was going to be late. Roy checked his cell phone every few minutes but there were no calls. By 7pm, he was panicked and headed over to Dana’s house.
When he got there, the doors were all locked. There were lights on upstairs but no one answered when he rang the doorbell. After a few minutes, Roy noticed a steady drip coming from somewhere above the front door. He recognized that the water appeared to be coming from Dana’s master bathroom. Frantic, he grabbed a crowbar from his truck and tore Dana’s front door from its hinges. Inside, Roy found his worst nightmare. Dana had apparently slit her own wrists and was lying dead in the overflowing bathtub.
A cruel claim denial
Roy was so upset that he could barely function. Nonetheless, someone from Dana’s law firm contacted him and reminded him to make a claim against her life insurance. Roy had thought the policy never would have paid in light of Dana’s suicide but he learned that exclusion only applied for the first two years of the policy. Dana had had the policy for 3 years when she died.
Reluctantly, Roy submitted a claim. It was worth a lot of money and Dana’s colleagues wanted to make sure he got it. What he got instead, however, was a cruel denial letter. In it, the claims adjuster stated that Dana’s policy “prevented payment of a death benefit if the beneficiary was involved in a crime that led to the policyholder’s death.” According to the adjuster, Roy’s act of breaking into Dana’s house on the night she died was a crime that triggered that exclusion. Roy was beside himself with grief and disbelief.
Luckily, Dana’s coworkers knew of an attorney at another firm who specialized in the wrongful denial of life insurance claims. They all agreed this was the cruelest and most bizarre denial they’d ever witnessed. With Roy’s consent, the attorney immediately filed a lawsuit against the insurance company for breach of the insurance policy and bad faith denial of claim. The latter claim carried a possibility of punitive damages against the insurer.
Not surprisingly, the insurance company ended up settling the case quickly. Roy was given the full policy benefit, plus benefits.This case just goes to show that life insurers will stop at nothing to avoid paying out valid claims. If you have received a life insurance claim denial, please call us today. We contest wrongful denials day in and day out. We’re here to help.